More Rwandans have embraced the concept and importance of saving thanks to the Covid-19 circumstances that have proved that relying on day-to-day income is untenable, especially in times of crisis.
According to the recent report of Rwanda Governance Scorecard (RGS), the saving rate as a percentage of gross domestic product (GDP) increased by 18.57 per cent from last year.
This is despite the fact that the Economic and Corporate Governance pillar, an indicator that gauges the state of the country in terms of economy, has declined by 3.49 per cent making it the lowest-performing pillar in the RGS.
Aimable Nkuranga, Executive Director of Association of Microfinance Institutions (AMIR), said people who managed to save before the pandemic coped better during lockdowns than those who didn’t.
“We expected that during this pandemic that has shaken the economy, savings from people would be disrupted but contrary, people understood the need to save money in ways that appreciate over time,” he said.
He explained that this also draws from the fact that some people who lost their jobs had to think and shift to other sources of income considering the responsibilities they carry.
This triggered the change in attitude towards the savings culture because they understood that any time, depending on circumstances, they might lose their jobs, he added.
Innocent Nkurunziza, a teacher at Groupe Scolaire Nyamugari in Nyamasheke District told The New Timers that during the period of lockdowns and other stringent measures, understandably there was no possibility of saving instead, heavy expenses with no revenue.
He, however, said, “when I discuss with my colleagues and friends in different fields, they resolved to have multiple sources of income and save part of the little they earn for any future crisis.”
According to the latest financial scope (2020) report from the central bank, 21 per cent of adult population save their money in banks, a rise from 13 per cent in 2016.
48 per cent of adult Rwandans have formal saving products in non-bank financial institutions such as credit and savings cooperatives and Mobile Money.
However, a large proportion of Rwandans, 64 per cent use informal saving mechanisms.